What happened
The value of ApeCoin (APE +12.70%) continues to climb on Wednesday as the project's hype picks up. The token launched last week and is up 7.2% in the last 24 hours as of 3:30 p.m. ET, but has been trading wildly with swings of 10% or more over the course of just a few hours.
So what
We're nearly a week into ApeCoin's launch and the value of the token continues to climb. Investors are pouring into the project because of its loose association with Yuga Labs and the Bored Ape Yacht Club, but for now it's a speculative token.
Image source: Getty Images.
There's currently no real use case for the ApeCoin, despite its $13 billion market cap as of today, and it's not clear what the use will be in the future. Yuga Labs, which developed the Bored Ape Yacht Club, was allocated a portion of the ApeCoin tokens, but this is not a Yuga Lab token and it isn't officially affiliated with the company. There's talk that ApeCoin might be used in a Yuga metaverse, but that hasn't been launched either.
Now what
It's hard not to be intrigued by the idea of a token even loosely affiliated with the Bored Ape Yacht Club, given that it's one of the most successful non-fungible token projects ever and has a multi-billion-dollar company behind it, but I also think it's important to keep in mind what traders are buying. This is a token with an unknown use case and was just given to thousands of people who have been selling at a rapid clip. The history of tokens like this is that they drop in value over time and that may happen with ApeCoin, too. For now, speculation is pushing the value higher, but I'm not bullish on this token until it's known what it will be used for.
